May 1-15, 2021 - Vol 1, Issue 21
INDIA NEWS
MAKE IN INDIA
MoU with Australia India Business Council (AIBC)
Footwear Supply Chain Footprint in India
By Neharika Mirakhur
I
nvest India and Australia India Business Council (with chapters in Sydney, Melbourne, Perth, Brisbane, Adelaide and Canberra) signed the Memorandum of Understanding on April-9-2021, aiming to facilitate foreign direct investment (FDI) in India with the vision of making a positive contribution to economic growth of the country and offering more opportunities to the citizens of India. Launch of Australia Micro-site The Australia India investment relationship has just begun. The potential to strengthen the relationship between India and Australia stems from the emergence of business opportunities. And the current economic, political and business environment in both countries has created an incentive to supplement collaborative efforts and discussions to give an impetus to trade and investment. With this website being launched exclusively for Australian investors and entrepreneurs, we wish to see our ties grow even more strong. All the information that an investor would need to enter and do business in India is available there with a dedicated 5-member team to provide handholding support to Australia businesses in their India journey. Why Australia Micro-Site:
www.indianews.com.au
India is the 2nd largest producer and consumer of footwear in the world. The leather and footwear industry in India is a high employment generating sector, contributing significantly to the country’s export earnings and economic growth. The footwear industry in India contributes about two per cent to India’s overall GDP along with employing more than four Mn workers. As per a report released by the Department for the Promotion of Industry and Internal Trade, the sector has the capacity to generate 250 jobs for every investment of INR 1 Crore. Additionally, for every 1,000 pairs of footwear produced and sold in India per day, the sector can create 425 jobs spanning manufacturing, allied industries, and retail. The sector holds an important place in the Prime Minister’s drive to Make in India and thus has been chosen as a Champion Sector. While India is a world leader in leather products, it is steadily gaining ground in the non-leather footwear segment. Presence of major Taiwanese companies such as Apache and Feng Tay in India are further accelerating India’s growth in the non-leather footwear segment. Footwear Market in India: Current scenario and growth projections The Indian Footwear Market was valued at ~ $ 9.3 Bn in the year 2019 with non-leather footwear segment comprising of ~ $ 5.3 Bn. Out of the breakup for non-leather footwear, ~ $ 2.4 Bn comprised of branded footwear. India, with consumption of 2,506 Mn pairs, is now the 2nd largest consumer of footwear globally, surpassing USA by 200 Mn pairs. India’s footwear consumption per
person increased from 1.7 in 2016 to 2.0 in 2019. The Indian footwear market is now expected to grow at 8% CAGR to be ~ $ 11.8 Bn by 2024-25 and the per- capita consumption of footwear is likely to increase from 2.33 pairs in 2021-22 to 2.94 pairs in 2024-25 i.e. to 3763 million pairs in 2024-25.5 Supply Chain Footprint: Clusters and Key Players India offers many footwear clusters wherein companies both Indian and foreign have set up their manufacturing plants. Below is a snapshot of the various footwear clusters along with the key players situated in those clusters. Starting from the northern part of India, the states hosting the footwear clusters include: Uttar Pradesh • Agra in the state of Uttar Pradesh has emerged as the largest footwear cluster in India. - Key players such as Von Wellx, a German shoe brand which has recently shifted its manufacturing units from China is setting up a plant in Agra. The company has collaborated with an Indian company, Latric Industries Group for the same. - Virola Shoes Pvt. Ltd., a leading export company in Agra manufactures footwear for Alberto Toressi, a popular European brand. The company uses a stress-free technology in their shoes so that their products are not only fashionable but also
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comfortable. They have a patent technology that they use in all the soles which keeps the shoe light and durable. • Kanpur hosts yet another major footwear cluster in India. Some of the key players situated in this cluster include: - Mirza International, a leading leather footwear manufacturer, marketer, and exporter. It owns brands such as Red Tape, Oaktrack and supplies leather footwear to leading international brands and has products available in 28 countries globally. -Tirubala Group, is one of the largest manufacturers and exporters of high quality, fashionable footwear for men, women, and kids. It has international markets comprising of countries such as USA, UK etc. and manufactures footwear products for many international brands such as Mango, Tempe, Arcadia Group, Bimba and Lola, Hoogenbosch, Lloyds, Esprit, Zara, Bershka, and Topshop. • Noida hosts footwear giants such as Woodland. The company sources its leather from tanneries in Jalandhar, Punjab. It has collaborated with vendors in Bangladesh, Taiwan, and China, for the outsourcing of a few SKUs. The city also hosts the Superhouse Group, leading producer of finished leather, footwear, leather accessories, textile garments etc. and produces leather for brands such as Hugo Boss and Michael Kors.
Haryana • Lakhani Footwear is one of the largest producers of sports shoes, beach slippers, PU (polyurethane) injected sports shoes, PVC (polyvinyl chloride) injected sports shoes with a total capacity of ~ 55.5 million pairs per year. It has been manufacturing shoes for leading brands and has established a strong alliance with Adidas for which it provides sports shoes. • Liberty Shoes is one of the leading Indian footwear brand manufacturers, manufacturing ~ 50,000 pairs a day. • Jasch Industries offers polyurethane (PU) and vinyl (PVC) coated fabric for various parts of footwear such as shoe upper, shoe linings and insoles. Delhi • Clarks Future Footwear is a leading manufacturer and retailer of footwear. Nearly 60% of the products it sells in India are sourced from India itself from companies such as Tata International and Farida Group. • Relaxo Footwear, a Fortune 500 (India) company, is one of the largest footwear manufacturers in India. They manufacture products such as rubber slippers, sandals, flip flops, sports shoes. States hosting footwear clusters in the southern part of India include: Tamil Nadu • Vellore and Chennai in Tamil Nadu have emerged as the key clusters in the state.
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